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August 26, 2010

Google Unveils Free Gmail Calling Service

by Sam Savage

Google Inc. announced on Wednesday that it is adding a free e-mail feature which will allow users of Gmail, the company's Web-based e-mail service, to make calls directly from their computers. The move places the Internet search giant in direct competition with companies such as Skype, Verizon and AT&T.

"Starting today, you can call any phone right from Gmail," said Google in a posting on the company's Gmail blog.

The new service allows U.S. Gmail users to place calls from any microphone-equipped computer to any telephone in the world. Calls in the U.S. and Canada will be free through end of the year, undercutting rates of 1.2 to 2.1 cents-per-minute charged by Skype, the most popular PC-to-phone service.

Skype, Google and others have been offering free computer-to-computer calling for years. However, Google seeks to generate revenue on its new PC-to-phone service by charging 2 cents or more per minute for international calls.

Gmail users also will be able to receive calls on their computer once they obtain a free phone number from Google.

The technology behind the new service is provided by Google's Voice telecommunications hub, which the search giant has been working to grow. The service had previously been available on an invitation-only basis, but was expanded two months ago to accept all requests.

Last year, the company said it had assigned some 1.4 million phone numbers through its voice service, which can field calls made to a user's home, office or mobile phone number.

Google Product Manager Craig Walker, who helped create Google Voice, said the service has expanded its reach since then, but declined to provide further details, the Associated Press (AP) reported.

In addition to incorporating Google Voice's technology into Gmail, the company plans to market the new service by deploying red phone booths at colleges and airports throughout the country, from which people can make free calls to U.S. and Canadian numbers and save on international calls.

Google also plans to allow users to transfer, or "port," their existing phone numbers on to Voice, a feature that will be available soon, Walker told the AP.

For now, the new calling service will be offered only to those with Gmail accounts, although Google did not rule out the possibility of expanding the service to businesses and government agencies that use Gmail as part of an applications suite that includes other programs.

Google's announcement is somewhat untimely for Skype S.A., which recently filed plans for an initial public offering of its stock.

The Luxembourg-based company had been under the ownership of eBay Inc. for four years, before being sold to private investors last November for about $2 billion.

Most of Skype's 560 million registered members use the company's free PC-to-PC calling service, but 8.1 million are paying customers.

The company has performed well in recent months, earning $13 million on revenue of $406 million during the first half of this year.